June 20 (Bloomberg) -- SoftBank Corp.’s Masayoshi Son said
he wants to improve wireless connection speeds and lower monthly
bills for U.S. customers as he pursues the acquisition of T-Mobile US Inc.

At SoftBank’s annual shareholder meeting today, the
billionaire chairman said he wants to expand in the U.S. because
its population growth and gross domestic product both exceed
Japan’s. Son, whose company paid $22 billion for Sprint Corp.
last year and is the largest investor in Alibaba Group Holding
Ltd., said he believes the U.S. wireless industry is “one of
the least satisfactory” in the world.

“I’m really determined to bring about better service at a
lower price in the United States,” Son said. “We could inspire
other carriers in the United States.”

Investors are focused on a potential bid by Sprint for T-Mobile because it would boost SoftBank’s growth prospects as
competition for wireless subscribers in Japan intensifies.
SoftBank, the nation’s third-largest carrier, faces slowing
business as customers cut spending on voice services and shift
to cheaper calling plans.

“SoftBank must go to overseas for growth as Japan’s
population is decreasing,” said Mitsushige Akino, executive
officer at Ichiyoshi Asset Management Co. “In the U.S. market,
it is vital to expand shares, and to do that, the T-Mobile
acquisition will be crucial.”

Saturated Market

The shareholder meeting approved the election of three new
board members.

SoftBank shares fell 0.1 percent to close at 7,783 yen in
Tokyo trading. The stock has lost 15 percent this year, compared
with a 2.6 percent decline in the benchmark Topix index. Sprint
fell 0.7 percent to $8.46 yesterday.

SoftBank forecast operating profit, or sales minus the cost
of goods sold and administrative expenses, will total 1 trillion
yen ($9.9 billion) in the year ending March 31, the company said
May 7. That would be a decrease of about 8 percent from the year
before.

There are only three companies in Japan that have achieved
more than 1 trillion yen in operating profit, and SoftBank
reached that level the fastest, Son said today. Profit from the
year ended March included one-time gains from Willcom Inc. and
Gungho Online Entertainment Inc.

T-Mobile Deal

The number of subscribers departing SoftBank rose, and
average revenue per user fell 2.2 percent to the lowest in at
least eight quarters as the carrier sold more devices with
cheaper plans and customers made fewer calls on its network, the
company said in May.

“If you think of Japan, the mobile phone business is
saturated,” Edwin Merner, president of Atlantis Investment
Research Corp. in Tokyo, said by phone. “To keep going they all
have to discount, they have to offer more for less and that
means less profits.”

SoftBank last year paid $22 billion to expand in the U.S.
with Overland, Kansas-based Sprint, which in April posted its
25th loss in 26 quarters. The company intends to spend $16
billion over two years upgrading its U.S. network in an effort
to close the gap with market leaders Verizon Wireless and AT&T
Inc.

“Through the information industry we have brought changes
to Japan,” Son said. “This is going to be the second stage.”

Alibaba Stake

Sprint is nearing an agreement on the price, capital
structure and termination fee for an acquisition of T-Mobile
that could value the wireless carrier at almost $40 a share,
people with knowledge of the matter have said. An agreement
could be announced as soon as next month, the people said.

Deutsche Telekom AG, based in Bonn, owns about two-thirds
of T-Mobile, and there are concerns by investors that Son may
borrow too much money to complete the deal. The carrier has
total debt of about 9.2 trillion yen, according to data compiled
by Bloomberg.

“Before they buy T-Mobile they should sell part of Alibaba
or pay back some debt so they don’t carry too heavy a level of
debt,” said Cedric Araud, a fund manager at Capitalatwork Foyer
Group SA in Luxembourg, which holds SoftBank shares. “First
they should focus on making Sprint more profitable.”

In response to one attendee’s expression of concern that
the company was accumulating too much debt, Son said: “SoftBank
will prioritize growth and take on more debt, as far as it is
within our repayment capability.”

Faster Internet

Growth, even if it means borrowing additional funds, is
critical for SoftBank, said 76 year-old Fumio Kosaka, a
shareholder who supports Son’s effort to acquire T-Mobile.

“Of course it is risky when the interest rate increases,
but it is better than doing nothing,” said Kosaka, who is from
Saitama prefecture near Tokyo. “To some extent it’s like
gambling, but a company’s strength can be retained by investing,
otherwise it will just die.”

Son, 56, has argued that as technology converges, a new
market for Internet services is emerging in which AT&T, Verizon
and Comcast Corp. are the three giants. He views a combined
Sprint and T-Mobile as a counterweight, able to offer wireless
high-speed Internet to compete with phone and cable modems.

SoftBank owns stakes in more than 1,000 Internet
operations, including Alibaba, and stands to benefit when
China’s largest online retailer goes public in what may be the
largest U.S. initial public offering ever. Alibaba’s market
value is estimated by analysts at $168 billion, according to
data compiled by Bloomberg.

$58 Billion

At that valuation, SoftBank’s stake of more than 30 percent
in Alibaba is worth about $58 billion, assuming those shares
translate into the same-sized holding in the listed company and
there are no conditions on their ownership. The stake started as
part of a $20 million investment in 2000.

SoftBank won’t sell any of its shares in the IPO, Son said
last month.

SoftBank, founded in 1981, has made almost 100 purchases
since 2000, according to data compiled by Bloomberg. The company
also owns stakes in Yahoo Japan Corp. and Supercell Oy.

Son’s deals have helped make him the second-richest person
in Japan with a net worth of $15.7 billion, according to the
Bloomberg Billionaires Index.